Coal’s decline has two main causes. Electricity use has virtually leveled off in the United States since the great recession began in 2008, leaving many U.S. utilities with excess generating capacity and more latitude to choose which of their power plants will operate. Meanwhile, the rapid decline in U.S. natural gas prices this year—averaging the equivalent of $13 per barrel of oil—has allowed utilities to fire up some of their newer and more efficient gas plants while idling many of their coal plants.

The steep decline of U.S. coal is already yielding substantial environmental dividends, including a big decrease in sulfur dioxide pollution in the Midwest and Northeast. Coal’s misfortune is also contributing to an unprecedented fall in U.S. emissions of carbon dioxide, the most important greenhouse gas. Emissions are down 14 percent from the peak in 2007 and are now only 2 percent above the 1990 level—the base year for national commitments under the Kyoto Protocol.

Coal’s loss of market share has stunned energy analysts who are scratching their heads about where the U.S. power business is headed next. The industry is burdened by scores of 50-80 year old coal plants that spew disproportionate quantities of air pollution. For two decades, they’ve been repeatedly exempted from U.S. clean air laws for new plants. Under President Obama, the EPA is finally implementing tighter standards for sulfur dioxide, mercury, and particulate emissions as well as rules for the disposal of coal ash. If gas prices stay relatively low, utilities may permanently close many of their older coal plants rather than making the substantial investments needed to bring them up to 21st century environmental standards.

The current price of gas for utilities is just one sixth the price they pay for dirty residual fuel oil—44 cents per gallon equivalent vs. $3.10 per gallon. Where coal used to provide over half of U.S. electricity, it’s now down to 35 percent this year while gas stands at 30 percent. Given the pace of change, gas could well become the largest source of U.S. electricity by the end of the decade. Wind and solar power are also growing rapidly—and falling in cost—which will further expand options for low-carbon electricity.

Those who were betting on a big future for coal, including the future addition of costly carbon capture and storage technology, may want to re-think their plans. A low-carbon American electricity system may be closer and less expensive than they imagine.